Clegg backs green response to recession
Monday, 30 March 2009 12:00 AM
By Alex Stevenson
Green issues are in danger of "slipping off the agenda" as the government struggles with recession, Nick Clegg has warned.
The Liberal Democrat leader's comments came as two reports showed the dangers and opportunities for the green sector in the current climate.
The New Economics Forum thinktank suggests that, contrary to Gordon Brown's pledge to spend ten per cent of the fiscal stimulus on "environmentally important technologies", just 0.6 per cent is being spent on greening the economy.
A separate report by Greenpeace presses the need for an energy efficiency programme to be included in the stimulus. It argues an annual £5 billion programme focused on improving domestic energy efficiency would create 55,000 jobs.
Mr Clegg backed Greenpeace director John Sauven's call for a "third industrial revolution" at the report launch in Westminster.
He told politics.co.uk the recession would have profounder effects than any since the second world war and that there was an urgent need to "integrate sustainability into the government's economic strategy".
"Does that cost? I'm not so sure it does," he said.
"Investing for long-term payback. is something the Treasury has always been very blind to. They've never understood the long-term return for public investment."
Mr Clegg rejected the suggestion the radical nature of the solutions proposed meant a commensurately radical cost to public spending plans.
He added: "In the short-term, it creates jobs. In the long-term. it shouldn't cost you half as much as many of the doomsayers suggest."
The report has also received the support of the TUC and the Federation of Master Builders (FSB).
Its backers have differing stances on how to divert the cash, however.
FSB's director general Richard Diment said VAT should be cut to five per cent for property refurbishment in a bid to create extra demand for energy efficient improvements.
Greenpeace's executive director John Sauven said the government should abandon the "unfocussed" VAT cut from 17.5 per cent to 15 per cent completely.
He called for this cash, about £1 billion every month, to be diverted into an energy efficiency programme "which delivers real value".
Today's report, written by consulting firm Impetus for Greenpeace, warns the government needs to invest heavily in energy efficiency if it is to meet its climate change goals.
Improvements to housing occupied by low-income households would be a priority under the scheme.
It states: "For the government to deliver its overall climate objectives, a retrofit programme for all housing will need to be implemented, with public and private sector investment totalling somewhere between £3.5 billion and £6.5 billion per year every year until 2050."
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